Yes, that is a feature. Right clicking on the menu bar minimizes it to 3 lines (red for health, blue for mana and yellow for stamina); right clicking on the lines brings back the full menu bar.

In latest download version of the game (1.006) this feature was removed, since it caused more problems than it was worth, and is less useful with people playing at higher resolutions than when the game was first released.

And just for the heck of it, if anyone would like to discover DD with the GOG release, here is a gift code (first come, first serve): -redeemed-